Interpleader Protects All Claimants Against Life Policy and the Insurer
Who’s on First to Get Life Insurance Proceeds
Post 5184
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Interpleader Protects All Claimants Against Life Policy and the Insurer
In Metropolitan Life Insurance Company v. Selena Sanchez, et al, No. 2:24-cv-03278-TLN-CSK, United States District Court, E.D. California (September 3, 2025) the USDC applied interpleader law.
Case Overview
This case involves an interpleader action brought by the Metropolitan Life Insurance Company (Plaintiff-in-Interpleader) against Selena Sanchez and other defendants (Defendants-in-Interpleader).
Key Points
Plaintiff-in-Interpleader’s Application:
The Plaintiff-in-Interpleader filed an amended application for leave to deposit funds into the Court registry. This application was granted by the Court.
Funds Deposit:
The Plaintiff-in-Interpleader is required to deposit a check payable to the Clerk of the United States District Court for the Eastern District of California in the amount of $10,159.99 plus any applicable interest into an interest-bearing account in the Court Registry.
Purpose of Interpleader:
The interpleader action aims to resolve the issue of multiple claims to the remaining life insurance benefits of the Decedent, Neal Sanchez. The Plaintiff-in-Interpleader seeks to deposit the funds to relieve itself from responsibility while the Court determines the rightful beneficiaries.
Beneficiary Designations:
There is an unresolved issue regarding whether the Decedent intended to change his beneficiary designations for his life insurance benefits due to technical malfunctions in the benefits system. This has led to uncertainty about the distribution of the remaining Plan benefits.
Legal Analysis
The Plaintiff-in-Interpleader seeks to deposit the funds to relieve itself from responsibility while the Court determines the rightful beneficiaries. The interpleader action is brought pursuant to Federal Rule of Civil Procedure 22 and 28 U.S.C. § 1335, which permit a party to file an interpleader claim when the party faces possible exposure to multiple liabilities from the defendants. The core purpose of Rule 67 is to relieve a party who holds a contested fund from responsibility for disbursement of that fund among those claiming some entitlement thereto. The decision to allow the deposit of property pursuant to Rule 67 is discretionary.
Beneficiary Designations
There is a significant issue regarding the Decedent’s beneficiary designations. The Decedent’s beneficiary designation form for the Plan dated March 5, 2014, designates four Defendants-in-Interpleader as equal beneficiaries of 25% each. However, due to a technical error in the benefits system, it is unknown if the Decedent intended to make the same beneficiary designation changes to his life insurance as his 401(k). This has led to the Plaintiff-in-Interpleader being unable to determine the rightful beneficiaries without risking exposure to multiple claims and liabilities.
Court’s Findings
The Court found that the deposit of the remaining life insurance benefits into an interest-bearing account is appropriate and granted the Plaintiff-in-Interpleader’s amended application. This decision was based on the unresolved issue regarding whether the Decedent intended to change his beneficiary designations for his life insurance benefits due to technical malfunctions in the benefits system. This has led to uncertainty about the distribution of the remaining Plan benefits. This action protects the Plaintiff-in-Interpleader from potential liability and ensures that the funds are distributed according to the Court’s determination.
ZALMA OPINION
When multiple parties claim the benefits of a life insurance policy and litigate against the insurer federal rules allow the insurer to deposit the proceeds of the life insurance policy into an interest bearing account under the control of the court and protects the interests of all the claimants and the insurer and gives the court time to determine which beneficiary and how much each are entitled to receive.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Western World Insurance Company issued a hull insurance policy for the vessel. With no personal representative yet appointed for the estate, the insurer cannot determine the proper payee for the insurance proceeds.
The insurer paid for the vessel’s recovery and removal, and the vessel is now with a salvage company, incurring substantial storage fees. The insurer determined the loss is covered under the ...
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Post 5249
Read the full article at https://lnkd.in/gfn_UHdp, see the video at https://lnkd.in/gDWVccnr and at https://lnkd.in/gv9nsBqk, and https://zalma.com/blog plus more than 5200 posts.
In Western World Insurance Company v. The Estate Of Shawn Arsenault, No. 25-cv-13413-PGL, United States District Court, D. Massachusetts (December 17, 2025) the USDC was asked to resolve a marine insurance dispute after the sinking of the F/V Seahorse, a commercial fishing vessel, off Cape Cod on June 8, 2025. The vessel’s owner and operator, Shawn Arsenault, died in the incident.
Western World Insurance Company issued a hull insurance policy for the vessel. With no personal representative yet appointed for the estate, the insurer cannot determine the proper payee for the insurance proceeds.
The insurer paid for the vessel’s recovery and removal, and the vessel is now with a salvage company, incurring substantial storage fees. The insurer determined the loss is covered under the ...
Zalma’s Insurance Fraud Letter
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ZIFL Volume 29, Issue 24
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Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/
Zalma’s Insurance Fraud Letter
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Post 5219
Posted on October 31, 2025 by Barry Zalma
An Insurance claims professionals should be a person who:
Can read and understand the insurance policies issued by the insurer.
Understands the promises made by the policy.
Understand their obligation, as an insurer’s claims staff, to fulfill the promises made.
Are competent investigators.
Have empathy and recognize the difference between empathy and sympathy.
Understand medicine relating to traumatic injuries and are sufficiently versed in tort law to deal with lawyers as equals.
Understand how to repair damage to real and personal property and the value of the repairs or the property.
Understand how to negotiate a fair and reasonable settlement with the insured that is fair and reasonable to both the insured and the insurer.
How to Create Claims Professionals
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The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
